§ Mr. Strangasked the Minister of Agriculture, Fisheries and Food (1)what would be the effect on the food price index, the retail price index and the total level of United Kingdom animal food expenditure of a 5 per cent., a 10 per cent, and 15 per cent. revaluation of the green pound, respectively;
(2) what would be the effect on the retail prices of beef, butter, bacon, sugar, cheese and bread of (a) a 5 per cent., (b) a 10 per cent. and (c) a 15 per cent. revaluation of the green pound; and what would be the effects, respectively, on the average weekly food bill.
§ Mr. Peter WalkerIt is not possible to say what precise effects green pound changes will have on the market. These will depend on the market situation for individual commodities and decisions by individual traders. When MCAs increased to 45 per cent. under the previous Administration, there was no evidence to show that this was fully reflected in the market.
If prices were to reflect fully the revaluation, the maximum impact on the food and retail price indices would be as follows:
5% Food price index just under 1% Retail price index about ¼% 10% Food price index about 1¾% Retail price index just under ½% 13.6% Food price index about 2¼% Retail price index about ½% Note A 15% revaluation of the green pound would not be possible at the current sterling market rate used for the calculation of monetary compensatory amounts; estimates for a revaluation of 13.6 per cent., which would eliminate the current MCA of 11.8 per cent., are therefore given instead.
§ Mr. Strangasked the Minister of Agriculture, Fisheries and Food what would be the short-term and long-term effects on United Kingdom patterns of agricultural production of a 10 per cent. revaluation of the green pound.
§ Mr. Peter WalkerIt is not possible to say whether there would be any significant shift between products in the short term. In the longer term, however, there would be a tendency to shift from livestock into arable production.